Question 1

LLL is an international oil and gas exploration company. It is considering investing S300 million in developing new oil fields in Country D. For this it will need to obtain a license from the government of Country D. These new oil fields will bring much wealth to Country D because a large proportion of the revenue from the production of oil will be paid to the government as part of the licensing agreement. However, oil production in Country D will have some undesirable social effects, such as the threat of pollution, congestion to the roads and pressure on local amenities such as housing, electricity and clean water. Which of the following approaches to stakeholder management should LLL NOT undertake in order to enter Country D?
A) Issue free shares in a Joint Venture to develop oil fields to government ministers from Country D.
B) Commit to improving the local amenities and roads as a part of the application for a license in Country D.
C) Develop and circulate a promotional video showing the benefits enjoyed by other countries in which LLL operates.
D) Undertake stakeholder mapping to identify the interests of the most powerful players in the decision to grant a license to LLL.

Accepted Answer

The answer of LLL is an international oil and gas...

Question 2

Which of the following would be likely to encourage an organization to use Scenario Planning? (Choose all that apply.)
A) The organization often experiences 'group-think', leading to a narrow view of the future.
B) Competitor's are increasingly using Scenario Planning as part of their strategy formulation process.
C) The organization has achieved all of its objectives and operates within a stable external environment.
D) The organization has not previously experienced any major surprises or expensive strategic mistakes.
E) Uncertainty in the industry is high, relative to management's ability to predict or adjust to change.

Accepted Answer

The answer of Which of the following would be likely...

Question 3

'Big data' refers to datasets whose size is outside the ability of typical database software tools to capture, store, manage and analyze. Which of the following statements is NOT a valid statement with regard to 'big data'?
A) 'Big data' will require the right infrastructure, incentives and safeguards to address public concerns.
B) As technology advances overtime, the size of datasets that qualify as 'big data' will also increase.
C) The definition of 'big data' can vary by sector, depending on the software tools and dataset sizes common to a particular industry.
D) Sufficient analytical and managerial talent is available to exploit the opportunities associated with 'big data'.

Accepted Answer

The answer of 'Big data' refers to datasets whose size...

Question 4

An organization must acquire suitable hardware and software in order to implement a knowledge management strategy so that knowledge can be stored and communicated. Which of the following would be appropriate systems to use in a knowledge management strategy? (Choose all that apply.)
A) Intranet
B) Local area network
C) Social media
D) Ledgers and journals
E) Internet
F) Groupware

Accepted Answer

The answer of An organization must acquire suitable hardware and...

Question 5

Which of the following would be correct considerations when evaluating the Feasibility of a strategy? (Choose all that apply.)
A) Will there be sufficient time to implement the strategy?
B) Will the strategy exploit the core competencies of the business?
C) Will the strategy maintain competitive advantage?
D) Will customers object to the strategy?
E) Will the business be able to deal with the responses of its competitors to the strategy?

Accepted Answer

The answer of Which of the following would be correct...

Question 6

HHH is a manufacturer which has a bonus scheme for its production workers related to the speed of output. HHH's products are very specialized and are made in a dangerous production environment. HHH's production workers usually work alone but sometimes, if there are problems in the production environment (for example, machinery breakdowns), they have to work in teams. When the production workers are working in teams they do not receive any bonus. HHH's senior management is proposing to amend the current bonus scheme to encourage increased productivity. Under the current bonus scheme, production workers receive extra pay when they achieve 45% of their individual target: The target level is low because of the dangerous production environment and the need to occasionally work in teams. Under the proposed bonus scheme, production workers will not receive any extra pay until they have achieved 90% of their individual target. Workers who achieve 90% or above of their individual target will be paid a 30% higher bonus. Which THREE of the following problems is HHH most likely to encounter with the introduction of the proposed bonus scheme? (Choose three.)
A) The extra production output will lead to an increase in inventory.
B) The proposed bonus scheme conflicts with health and safety legislation.
C) Production workers could consider the new target as unachievable.
D) Production workers will not be motivated by the proposed level of bonus.
E) There could be a rise in the level of workplace accidents.

Accepted Answer

The answer of HHH is a manufacturer which has a...

Question 7

ABC is an independent training provider in Country F. It provides training in business related subjects to a wide range of corporate customers. All of its tutors must possess a nationally accredited training qualification before being allowed to teach and all of its courses follow nationally accredited programmes which are externally monitored. This is considered to be a critical aspect of its business reputation. ABC has one major competitor, XYZ, within Country F. XYZ offers similar courses to ABC but its tutors do not have to have an accredited training qualification and its courses do not follow the national accredited programmes. The style and content of courses varies significantly between XYZ's centers. There are a number of universities which offer nationally accredited courses within Country F. ABC does not consider these as competitors because typically they attract students wishing to undertake degree courses. The average university pass rate for nationally accredited programmes is currently higher than ABC's. Which of the following types of benchmarking would be most useful for ABC?
A) Process
B) Internal
C) Competitor
D) Strategic

Accepted Answer

The answer of ABC is an independent training provider in...

Question 8

A direct external change trigger is:
A) A general increase in the use of the Internet by society.
B) An economic recession in an organization's home country.
C) A powerful competitor forcing an organization to cut its prices.
D) The introduction of new environmental protection policies by the government.

Accepted Answer

The answer of A direct external change trigger is:
A) A...

Question 9

TUV had an employee turnover rate of 25% among new recruits and was becoming short of skilled workers. The Board of TUV realized there was something dramatically wrong and called in consultants to assess the problem. The consultants recommended transformational change in that TUV should redesign the entire production system, change the placement of all equipment and the flow of work, redefine every job and give all workers new assignments. Which type of change did the consultants recommend for TUV?
A) Evolution
B) Reconstruction
C) Revolution
D) Adaptation

Accepted Answer

The answer of TUV had an employee turnover rate of...

Question 10

Which of the following statements is NOT a role for Management Accountants involved in the strategy development process?
A) Consider and raise awareness of the ethical impact of proposed strategic decisions.
B) Integration of financial and non-financial information.
C) Writing the Annual Report.
D) Assist the Board in determining risk appetite.

Accepted Answer

The answer of Which of the following statements is NOT...

Question 11

Company TTT produces a range of products, including products T1 and T5. Product T1: Profitability has declined in recent years, although small profits continue to be made as the market contracts due to changing customer preferences. Overall market share is low and continues to reduce. However, in addition to external sales T1 is also used as a component of product T5. Product T5: A market leader within a low growth market, sources components both externally and from TTT's other subsidiaries. T5 benefits from significant economies of scale and TTT has recently considered modernizing its T5 production line but following a cost benefit analysis, decided not to proceed. Which of the following is an appropriate strategy for TTT to adopt?
A) Divest both product T1 and product T5.
B) Harvest product T1 and Divest product T5.
C) Harvest both product T1 and product T5.
D) Divest product T1 and Harvest product T5.

Accepted Answer

The answer of Company TTT produces a range of products,...

Question 12

BCA is a long established international airline. Which of the following represent Threats to BCA's business? (Choose all that apply.)
A) A sudden increase in international terrorism.
B) A substantial rise in the price of oil.
C) A higher level of private car ownership.
D) Greater popularity of long-haul holidays.
E) A shortage of trained pilots in BCA.

Accepted Answer

The answer of BCA is a long established international airline....

Question 13

Ansoff has provided a product/market growth matrix which denotes possible strategic directions that an organization can follow. Which of the following statements correctly describe the strategic options generated by the matrix? (Choose all that apply.)
A) Diversification using new products in new markets.
B) Product development using new products in new markets.
C) Market development using existing products in new markets.
D) Market penetration using existing products within existing markets.
E) Market penetration using existing products in new markets.
F) Market penetration using new products within existing markets.

Accepted Answer

The answer of Ansoff has provided a product/market growth matrix...

Question 14

M has been appointed as an external change agent to lead and implement a large scale re-structuring strategy which is being undertaken by a large bank. M has been appointed due to his extensive experience in a wide range of organizational re-structuring programmes. This re-structuring strategy will involve a large number of redundancies and the implementation of a new organization-wide management reporting system. M will need to work with staff from all departments and levels of the organization. The Board of Directors of the bank believes that an external change agent will bring more benefits to the change process than using an internal change agent. Which of the following are the most likely benefits that could be achieved by the bank by appointing an external change agent to lead and implement the re-structuring strategy? (Choose all that apply.)
A) The change process should be less costly if an external change agent is appointed.
B) The bank can exploit the specialist expertise of the external change agent.
C) As a dedicated resource, the external change agent can give more time to the change process.
D) The external change agent will be more objective in decision-making than an internal change agent.
E) The external change agent will have better relationships with the bank employees than an internal change agent.
F) The speed of delivery of the change process will be quicker when using an external change agent.

Accepted Answer

The answer of M has been appointed as an external...

Question 15

BBB is a manufacturer that has been criticized in the financial press because it does not have a policy for sustainability. Which THREE of the following elements would be crucial to BBB successfully embedding sustainability into its activities? (Choose three.)
A) BBB should include sustainability targets in performance appraisal.
B) BBB's Board should make a commitment to sustainability.
C) BBB should give all its staff training in sustainability.
D) BBB should spend at least 0.1% of its Net Profit on sustainability projects.
E) BBB should employ a new public relations consultancy.
F) BBB should investigate the costs and benefits of establishing a sustainability department.

Accepted Answer

The answer of BBB is a manufacturer that has been...

Question 16

A leading retail chain is undertaking environmental scanning as it is concerned that it is becoming uncompetitive and profits have started to fall. The Board of Directors is concerned that it will need to have a viable strategy to present to its shareholders at the next annual general meeting, in order to prevent shareholders' protests. The company has been reluctant in the past to offer an Internet shopping service. It now believes, however, that by offering this service and introducing customer relationship marketing (CRM), this will produce a strategy that will help it to improve its competitiveness. Which of the following statements apply to CRM? (Choose all that apply.)
A) The company must be prepared to take customers' needs into account and be able to meet these needs.
B) In mature markets, existing customers provide the most likely source of future earnings.
C) CRM is about marketing to customers to obtain their loyalty, so customer research is not needed.
D) CRM utilizes marketing resources to retain, rather than simply attract new customers.
E) The CRM process needs to include increasing the range of products that will be offered to customers.

Accepted Answer

The answer of A leading retail chain is undertaking environmental...

Exam 1: E3 - Strategic Management Question Tutorial

Which of the following would be likely to encourage an organization to use Scenario Planning? (Choose all that apply.)

'Big data' refers to datasets whose size is outside the ability of typical database software tools to capture, store, manage and analyze. Which of the following statements is NOT a valid statement with regard to 'big data'?

An organization must acquire suitable hardware and software in order to implement a knowledge management strategy so that knowledge can be stored and communicated. Which of the following would be appropriate systems to use in a knowledge management strategy? (Choose all that apply.)

Which of the following would be correct considerations when evaluating the Feasibility of a strategy? (Choose all that apply.)

A direct external change trigger is:

Which of the following statements is NOT a role for Management Accountants involved in the strategy development process?

BCA is a long established international airline. Which of the following represent Threats to BCA's business? (Choose all that apply.)

Ansoff has provided a product/market growth matrix which denotes possible strategic directions that an organization can follow. Which of the following statements correctly describe the strategic options generated by the matrix? (Choose all that apply.)

BBB is a manufacturer that has been criticized in the financial press because it does not have a policy for sustainability. Which THREE of the following elements would be crucial to BBB successfully embedding sustainability into its activities? (Choose three.)